The RBI on Friday increased the interest rate ceilings on Foreign Currency Non-Resident Bank deposits or FCNR (B) deposits which will enable NRIs to earn more on their savings.
The move is aimed at attracting more foreign capital at a time when the Indian rupee has come under pressure as foreign investors have been pulling money out of the Indian stock markets resulting in hot money outflows.
FCNR(B) deposits are accounts where Non-Resident Indians (NRIs) can hold their earnings in foreign currencies like USD or GBP, protecting them from exchange rate fluctuations.